Taxing Times

On 1 July 2009, in response to the 2009/2010 federal Budget, s23AG of the Income Tax Assessment Act 1936 (Cth) (ITAA36) was amended to include a new s23(1AA). This amendment has the effect of disallowing certain Australia resident individual taxpayers, who are engaged for more than 90 days of continuous foreign service, from claiming an exemption in respect of their foreign employment income. At present, Australia's largest expatriate community is located in the UK followed by the US, New Zealand and Hong Kong. With the latest figures available suggesting that nearly 5 per cent of the Australian population lives overseas on a long-term basis, this amendment is important to legal advisers of Australian clients who are working or sending employees overseas